First of all let me apologize for taking so long to get our payment system back on line. I actually changed it to make the process much more secure for our customers (credit card transacations will now be processed with verisign). However, as I’m in Asia now on business, and decided to go with programmers out here to integrate the system, let’s just say that sometimes things are slower than optimal out here. Not that the programmers aren’t good because some of the best programmers in the world are from this part of the world but sometimes the process is not as quick as I’d like it to be with things that I think should take two days taking two weeks instead to implement.

But back to your comment, if you are invested in China and have huge profits I always advocate using trailing stop losses if you’re sitting on huge gains. i.e. put a tight trailing stop loss of 5% to 10% if you’re sitting on stocks with 40% to 80% gains. Therefore you lock in gains if the markets decline. Always lock in gains is something you should practice. Again, if you also want to play a decline in the U.S. markets and don’t want to play more volatile puts, look at the ProShares SDS (it looks to swing double of the direction of the S&P 500). I think the quick run ups everywhere , in India, the U.S., China, etc are worrisome and that we are overdue for a correction. However, irrational exuberance of investors can drive markets for quite some time. In the U.S. the volatility index is really low and insider selling to insider buying is massively overweighted towards selling as of recently.

As far as gold stocks, even if gold stocks correct some, I would hold on. You have to be willing to go through some volatility with gold stocks as they don’t behave like “traditional” stocks but if you understand what will ultimately drive them higher then the temporary corrections shouldn’t worry you. For example, for the few clients I have accepted and do manage, at one point, many of my gold stocks were down 20% to 35% about half a year ago when gold when through a steep correciton. However, I wasn’t worried and now those same stocks are up 35% to 40%, a huge swing of 50% to 75% in just six months. Read up as much as you can about gold stocks to understand what how you must approach this asset class. I believe our course offers the most comprehensive information on how to evaluate gold stocks but there are other good sources out there as well.

As far as traditional markets, I see very little right now that offers a good risk-reward set up. I think the top Japanese financial stocks will offer good value very soon, but I am waiting for a correction before adding any other traditional stocks to my portfolio.

Best,

J.S.